Question 1

Alice is terminally ill and does not expect to live much longer.Pondering the consequences of her estate,she decides how to allocate her property to her nieces.She makes a gift of depreciated property (i.e.,adjusted basis exceeds fair market value)to Marsha,a gift of appreciated property (i.e.,fair market value exceeds adjusted basis)to Jan,and leaves appreciated property to Cindy in her will.Each of the properties has the same fair market value.From an income tax perspective,which niece is her favorite?

Accepted Answer

The answer of Alice is terminally ill and does not...

Question 2

Discuss the application of holding period rules to property acquired by gift and inheritance.

Accepted Answer

The answer of Discuss the application of holding period rules...

Question 3

Mitchell owned an SUV that he had purchased two years ago for $48,000 and which he transfers to his sole proprietorship.How is the sole proprietorship's basis for the SUV calculated? What additional information does Mitchell need?

Accepted Answer

The answer of Mitchell owned an SUV that he had...

Question 4

Can related parties take advantage of the like-kind exchange provisions?

Accepted Answer

The answer of Can related parties take advantage of the...

Question 5

What is a deathbed gift and what tax consequences apply?

Accepted Answer

The answer of What is a deathbed gift and what...

Question 6

What effect do the assumption of liabilities have on a § 1031 like-kind exchange?

Accepted Answer

The answer of What effect do the assumption of liabilities...

Question 7

Identify two tax planning techniques that can be used to avoid the wash sale disallowance of loss.

Accepted Answer

The answer of Identify two tax planning techniques that can...

Question 8

Why is it generally undesirable to pass property by death when its fair market value is less than basis?

Accepted Answer

The answer of Why is it generally undesirable to pass...

Question 9

What requirements must be satisfied to receive nontaxable exchange treatment under § 1031?

Accepted Answer

The answer of What requirements must be satisfied to receive...

Question 10

Tariq sold certain U.S.Government bonds and State of Oregon bonds at a loss to offset short-term capital gain from a previous transaction.He felt that the U.S.Government and State of Oregon bonds were "good" investments,so he repurchased identical securities within one week.Do these transactions constitute wash sales?

Accepted Answer

The answer of Tariq sold certain U.S.Government bonds and State...

Question 11

Define an involuntary conversion.

Accepted Answer

The answer of Define an involuntary conversion....

Question 12

Seth and Cheryl,husband and wife,own property jointly.The property has an adjusted basis of $25,000 and a fair market value of $30,000.

Accepted Answer

The answer of Seth and Cheryl,husband and wife,own property jointly.The...

Question 13

What is the easiest way for a taxpayer who is going to sell property that has declined in value to avoid the § 267 loss disallowance provision?

Accepted Answer

The answer of What is the easiest way for a...

Question 14

For disallowed losses on related-party transactions,who has the right of offset?

Accepted Answer

The answer of For disallowed losses on related-party transactions,who has...

Question 15

Discuss the logic for mandatory deferral of realized gain or loss for a § 1031 like-kind exchange.

Accepted Answer

The answer of Discuss the logic for mandatory deferral of...

Question 16

Discuss the relationship between realized gain and boot received in a § 1031 like-kind exchange.

Accepted Answer

The answer of Discuss the relationship between realized gain and...

Question 17

Discuss the relationship between the postponement of realized gain under § 1031 (like-kind exchanges)and the adjusted basis and holding period for the replacement property.

Accepted Answer

The answer of Discuss the relationship between the postponement of...

Question 18

Explain how the sale of investment property at a loss to a brother is treated differently from a sale to a nephew.

Accepted Answer

The answer of Explain how the sale of investment property...

Question 19

Under what circumstance is there recognition of some or all of the realized gain associated with the giving of boot by the taxpayer in a like-kind exchange?

Accepted Answer

The answer of Under what circumstance is there recognition of...

Question 20

What kinds of property do not qualify under the like-kind provisions?

Accepted Answer

The answer of What kinds of property do not qualify...

Quiz 13: Property Transactions